Income and Expenses

Annual Expenses Worksheet

Record regular and seasonal income
Step one is to look at your monthly income and expenses. This is not a budget; it is a snapshot of what's going on right now in your household. Using the “Income and Expenses” and “Annual Income” worksheets at the end of this booklet, begin by writing down all of your sources of income. If your income fluctuates seasonally, write down what it is now, and what it should be for the next few months. If you have unreliable income (such as child support) do not count it.

Record regular and periodic expenses
Next, write down your expenses, starting with the necessities, such as rent, electricity, telephone, groceries, gasoline and insurance. As you go down the page, list other items such as clothing, cable, pets, dining out, etc. You can use the above prepared form or a blank sheet of paper--whichever is easier for you. Be sure to include periodic expenses, such as car registration or property taxes (if applicable). For the purposes of this exercise, simply list those expenses on a separate sheet of paper and divide them out so that you have a monthly expense. Add that to your expense list.

Did you include emergency types of expenses, such as car repairs? Again, estimate what you spend over an entire year and divide by 12 to get a monthly expense. Total up your income, then total up your expenses. Subtract your expenses from your income. Is anything left over? Do you spend more or less than you earn? Are you surprised at how much is left over? If so, maybe you forgot something.

Track your expenses and revise
Keep working with this. It takes a little time to dig out what you usually spend on each thing, but the closer you get to reality, the better off you'll be in your planning. Be honest with yourself! Remember, your job right now is simply to find out what's going on right now.

If you don't keep great records of your spending, try keeping a spending diary for a month. A spending diary is a book you carry in your purse or pocket in which you record every penny you spend throughout the day. At the end of the day, record your spending by category so it fits into the income/expense sheet like we just completed. I guarantee you'll be surprised by how those little expenses like soda from the vending machine, coffee at a coffee shop or a convenience store, or a pack of cigarettes a day will add up.

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